Correlation Between Pimco Global and Pcm Fund

Can any of the company-specific risk be diversified away by investing in both Pimco Global and Pcm Fund at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Pimco Global and Pcm Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pimco Global Stocksplus and Pcm Fund, you can compare the effects of market volatilities on Pimco Global and Pcm Fund and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Pimco Global with a short position of Pcm Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Global and Pcm Fund.

Diversification Opportunities for Pimco Global and Pcm Fund

-0.6

Correlation Coefficient

Pimco Global  Pcm Fund

Excellent diversification

The 3 months correlation between Pimco and Pcm is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Global Stocksplus and Pcm Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pcm Fund and Pimco Global is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Pimco Global Stocksplus are associated (or correlated) with Pcm Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pcm Fund has no effect on the direction of Pimco Global i.e., Pimco Global and Pcm Fund go up and down completely randomly.

Pair Corralation between Pimco Global and Pcm Fund

Considering the 90-day investment horizon Pimco Global Stocksplus is expected to generate 0.34 times more return on investment than Pcm Fund. However, Pimco Global Stocksplus is 2.94 times less risky than Pcm Fund. It trades about 0.16 of its potential returns per unit of risk. Pcm Fund is currently generating about -0.1 per unit of risk. If you would invest  761.00  in Pimco Global Stocksplus on December 26, 2024 and sell it today you would earn a total of  48.00  from holding Pimco Global Stocksplus or generate 6.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Pimco Global Stocksplus  vs.  Pcm Fund

Pimco Global Stocksplus

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Global Stocksplus are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, Pimco Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pcm Fund

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pcm Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of conflicting performance in the last few months, the Fund's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the fund investors.

Pair Trading with Pimco Global and Pcm Fund

The main advantage of trading using opposite Pimco Global and Pcm Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Global position performs unexpectedly, Pcm Fund can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Pcm Fund will offset losses from the drop in Pcm Fund's long position.

The idea behind Pimco Global Stocksplus and Pcm Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.